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Why I think the US would push for a high RV.

Perspective2011
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Perspective2011 Newbie

Perspective2011

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Foremost:

I am not sure how the currency cash out is handled from both countries(US and Iraq) when the time comes for an RV.

Things to consider:

1. It has been about oil and for now always will be about oil. Fuel prices are skyrocketing and peaking at $3.95+ a gallon in some states across the country.

2. US created a Bill that allows US to invest in Iraq's restructuring. This will help, but, at the same time increase the "pot" on how much Iraq will have to pay back investors.

3. "Iraq exported a total of 67 million barrels of oil last month(Jan 2011), generating $6.082 billion in income at an average price of $90.78 a barrel..."

Oil is now over $100 a barrel and they expect it to increase production from 2.6 - 2.7 million barrels a day to 3 million barrels a day.

http://www.google.com/hostednews/afp/article/ALeqM5jpmmq9Wt4JHkd8CMFo1MngZz0-VA?docId=CNG.867dcb3d94702f9df32e0fdbe6185a98.541

Speculation:

There are many key elements involved that has been put in place to make this possible. It was obviously a well thought out "plan" to effectively mirror the US government within Iraq. Why? Well, there are many reasons IMO. We needed stable soil for Iraq to flourish for not only their people, but the US as well. The US had to nurture Iraq to maturity in order to show they can maintain a stable environment to have have sanctions lifted and have a full member status with WTO. This will bring businesses, increased oil production and the well being of their citizens. If citizens are not happy, remain poor and are uneducated then you increase the chances of protests, etc...

Why would a country go through such trouble to fight a war and invest years and years worth of aid? There reason is simply OIL. Here's why I think the US will want and actually NEED a decent RV to occur. People say that Iraq does not have enough to pay investors with the amount of money printed. Remember, the US opened the doors for investment to Iraq. It would appear "beneficial" to the people of Iraq for the US to invest to help the restructuring. With the increased amount of investors there is now a larger base of people waiting for a return on their money...

Considering the above, who is to say that the payout to investors won't be returned from the profit made from the millions upon millions of barrels of oil each and every month. Obviously the Us would push for a higher RV in order to maximize their gain of being repaid in cheaper oil. If the US was offered a fixed rate on barrels of oil Iraq could pay with resources vs currency. Let's say Iraq worked out a deal for a fixed rate of $35(speculating) a barrel to pay investors(Yes US government is one of them) to pay the investment debt. How long do you think it would take to repay a country out of a natural resource that resides on their land? Iraq has the opportunity and resources that prevents them from having to pay any physical currency. Iraq actually earns money considering they will be paid $35(speculation) in return for each barrel. The average consumption of 21,000,000 million barrels a day for the US. How long do you think it would take to pay back any debts...

***NOTE*** I don't know if OPEC could stop something like this. I don't trust anyone when it comes to oil, for all we know they will be included in some shape or form if they can intervene. ***NOTE***

http://en.wikipedia.org/wiki/Energy_in_the_United_States

"U.S. oil consumption is approximately 21,000,000 barrels per day (3,300,000 m3/d), yet domestic production is only 6 million barrels per day (950,000 m3/d). Hence, the majority of oil consumed in the United States must be imported. The cost to import oil is approximately $410 billion dollars a year (at $75/barrel)"

The cost above is just at $75 a barrel, we are pushing past the $100 mark.

Since Iraq can push 67,000,000 barrels and soon to be more a month lets round down(domestic oil in US) and calculate...

Assume the going rate is $100 a barrel and that the US is getting a fixed rate of $35...

Iraq would be credited $65 per barrel since this is the difference of $100 - $35.

60,000,000 x $65 = $3,900,000.000 billion dollars a month Iraq can "pay back" with their use of natural resources.

Now the US can PROFIT extra on fuel from the $65 discount given to then since they only paid $35 per barrel. Iraq wins, US wins, the citizens for both countries WIN!

So... I ask anyone why the US would want to push for a low RV when a healthy RV would ensure Iraq has a bigger debt of natural resources to pay back with in return.

I am not an expert, just someone that has been watching closely for the past 2 weeks when I got started. I am trying to think of the possibilities beyond the currency used to pay our "cash in" debts from an RV when we know that the US has always focused on OIL...

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easyrider Newbie

easyrider

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emot-shakehead.gif The US has absolutely no input into the RV value....None. Where would you get such an idea?

Tim please you do not know that either this is your opinion please respect others as well. This is a wild ride who knows who has their hand in the revaluation of the dinar.

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GasCan Newbie

GasCan

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Tim please you do not know that either this is your opinion please respect others as well. This is a wild ride who knows who has their hand in the revaluation of the dinar.

Very true. Anything is possible at this stage.

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mentalmagic Newbie

mentalmagic

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US has absolutely no say in the RV rate. Current Iraq economic data will determine the rate set by CBI. Right now, it appears to be only a few cents per dinar if the RV happened today. I hope it's higher, but that is around where it would be based on all the economic data.

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easyrider Newbie

easyrider

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US has absolutely no say in the RV rate. Current Iraq economic data will determine the rate set by CBI. Right now, it appears to be only a few cents per dinar if the RV happened today. I hope it's higher, but that is around where it would be based on all the economic data.

they might not directly but who knows they could have an influenece no one knows and for you to say you absolutely know is ridiculous.

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Perspective2011 Newbie

Perspective2011

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they might not directly but who knows they could have an influenece no one knows and for you to say you absolutely know is ridiculous.

EasyRider: Exactly!

I absolutely believe the US has some ties with the RV. The US has invested entirely too much time, effort, money, and blood to not have some sort of financial gain. There is an objective and if anyone thinks it was to just bring a government to power then you have too much faith in the system...

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